I think if you sat with a pro for a day or two you'd be surprised just how simple some of their winning techniques are. Doesn't mean they were simple to find in the first place but they're certainly replicable and easy to implement. But, for numerous reasons, the majority rarely stick to what they know actually makes money,or even know, and flit around looking for excitement or ways to be more active in the markets.Tonto wrote: My question to you all is: It can't be this simple.If it were, we'd all be winning and there would be no losers.Where is my logic flawed?
Market moves - right or wrong?
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spreadbetting
- Posts: 3140
- Joined: Sun Jan 31, 2010 8:06 pm
You have to watch the ladder and monitor how much back/lay money is getting matched. For example, there could be a drifter with the lay money just eating up all the back money, however, there will be a time(s) when there will be resistance, and it is up to you figure out if there is sufficient back money to reverse the trade, or if it will continue on its path.
This is the absolute last thing you should be doing; what you describe is a good way to throw away money as fast as possible. You have badly misinterpreted Jolly.Tonto wrote:My thoughts are that I should treat the market as my guide and look for a trend (just as Jolly says).For example,if the trend on a horse is up,I should lay and look to back later at higher odds.Likewise,if the trend is down,I should back and look to lay later at lower odds.
Why?Zenyatta wrote: This is the absolute last thing you should be doing;
And I don't think that Tonto has misinpreted Jolly. What Jolly seems to be essentially saying is 'go with the market's flow - don't try to outwit it or second guess it'.
Jeff
No offence but just because you couldn't master it, it doesn't mean it isn't true.Zenyatta wrote:This is the absolute last thing you should be doing; what you describe is a good way to throw away money as fast as possible. You have badly misinterpreted Jolly.
The poster seems to think he can just identify a trend and throw money on based on what the price is doing ... 'if it goes up lay, if it goes down back'.Naffman wrote:No offence but just because you couldn't master it, it doesn't mean it isn't true.Zenyatta wrote:This is the absolute last thing you should be doing; what you describe is a good way to throw away money as fast as possible. You have badly misinterpreted Jolly.
I think we can all agree that exploiting a trend is a bit more complex than that.
This poster (me - Tonto) actually wrote:Zenyatta wrote:The poster seems to think he can just identify a trend and throw money on based on what the price is doing ... 'if it goes up lay, if it goes down back'.Naffman wrote:No offence but just because you couldn't master it, it doesn't mean it isn't true.Zenyatta wrote:This is the absolute last thing you should be doing; what you describe is a good way to throw away money as fast as possible. You have badly misinterpreted Jolly.
I think we can all agree that exploiting a trend is a bit more complex than that.
... if the trend on a horse is up,I should lay and look to back later at higher odds.Likewise,if the trend is down,I should back and look to lay later at lower odds.As long as the trend continues,I should stay in until the trend reverses or the start of the race is imminent,in which case I should close out the trade, take my profit and run.If the trade goes against me at any stage, I should admit my mistake and trade out for a small loss.Using this strategy,I should maximise my gains and minimise my losses. My question to you all is: It can't be this simple.If it were, we'd all be winning and there would be no losers.Where is my logic flawed?
I didn't imply that it was simple nor did I imply that one should adopt the approach that I outlined in my initial post.I merely stated that it couldn't be this simple and asked where my logic was flawed.
Ever ask a question and then wished that one hadn't bothered?
The best way to find out is simply to experiment and see what happens.Tonto wrote: My question to you all is: It can't be this simple.If it were, we'd all be winning and there would be no losers.Where is my logic flawed?
I didn't imply that it was simple nor did I imply that one should adopt the approach that I outlined in my initial post.I merely stated that it couldn't be this simple and asked where my logic was flawed.
The main difficulty with trend following is this:
by the time a trend has become obvious to you, you will find that it is often too late to profit, since the price will by this point have moved as far as its going to go, and in fact will have often 'over-shot' (moved too far in one direction) and will be about to reverse on you by the time you get your money on (meaning you will lose).
To win, you will need to anticipate the trend before it happens, and get your money on early, before the price has started to move much. This isn't that easy.
If you are active and in the market long enough it's really easy to support something that is trending and is continuing to get support and something that is trending but no longer has support.
The biggest battle most traders face is feeling that they have missed out and therefore jumping in at the end of a trend and that's mainly a psychological issue.
The biggest battle most traders face is feeling that they have missed out and therefore jumping in at the end of a trend and that's mainly a psychological issue.
Yeah, the problem is jumping in the end of a trend instead of the beginning. But unless someone has studied the markets for a while, I think they will probably not be able to recognize a trend until its too late, and keep trying to jump in at the end and doing their nuts.Euler wrote:
The biggest battle most traders face is feeling that they have missed out and therefore jumping in at the end of a trend and that's mainly a psychological issue.
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JollyGreen
- Posts: 2047
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There is no flaw in your logic but clearly you have some doubt which is to be expected. What happens to a lot of traders is they worry about "what if" all the time and they get pushed around by the market. I will give you an example I have seen many times.Tonto wrote: My question to you all is: It can't be this simple.If it were, we'd all be winning and there would be no losers.Where is my logic flawed?
Most traders are not reading the market they are looking for what they want to see. This creates a conflict situation which causes doubt and this leads to losses. They are looking for a drift (for whatever reason) so when the price shortens they have a conflict. They will either try and oppose the trend, watch it move down and then catch the reverse for a loss (as Euler mentioned) or they will wait for the the reverse and praise themselves when it occurs. If they join the move down and it reverses they take a negative view but compliment themselves for "knowing it would reverse on them!" This sounds perverse but I have seen it many times.
They also suffer like a rabbit in the headlights. They watch the move and when it reverses they congratulate themselves for knowing it would come. They miss the fact it has steamed in 15 ticks but when this is pointed out to them they say "yeah but what if it had reversed when I joined?"
You can reverse this to a drifting price, it's the same thing.
It is built into the human psyche for a lot of people and you need to shake it off. It is not a criticism and it is nothing to be ashamed of so to speak. It is always easier to be the victim because you can say "it's not my fault" or "I knew that would happen" or "this always happens to me". You need to shed that mentality and reverse your psyche. If it doesn't work out just tell yourself you tried and there will be another chance. Once you get into that mode you will find things become a lot clearer
Thanks JollyG. What you are saying is that some people's losses are caused by their psyche. I'm sure that you are right.JollyGreen wrote:There is no flaw in your logic but clearly you have some doubt which is to be expected. What happens to a lot of traders is they worry about "what if" all the time and they get pushed around by the market. I will give you an example I have seen many times.Tonto wrote: My question to you all is: It can't be this simple.If it were, we'd all be winning and there would be no losers.Where is my logic flawed?
Most traders are not reading the market they are looking for what they want to see. This creates a conflict situation which causes doubt and this leads to losses. They are looking for a drift (for whatever reason) so when the price shortens they have a conflict. They will either try and oppose the trend, watch it move down and then catch the reverse for a loss (as Euler mentioned) or they will wait for the the reverse and praise themselves when it occurs. If they join the move down and it reverses they take a negative view but compliment themselves for "knowing it would reverse on them!" This sounds perverse but I have seen it many times.
They also suffer like a rabbit in the headlights. They watch the move and when it reverses they congratulate themselves for knowing it would come. They miss the fact it has steamed in 15 ticks but when this is pointed out to them they say "yeah but what if it had reversed when I joined?"
You can reverse this to a drifting price, it's the same thing.
It is built into the human psyche for a lot of people and you need to shake it off. It is not a criticism and it is nothing to be ashamed of so to speak. It is always easier to be the victim because you can say "it's not my fault" or "I knew that would happen" or "this always happens to me". You need to shed that mentality and reverse your psyche. If it doesn't work out just tell yourself you tried and there will be another chance. Once you get into that mode you will find things become a lot clearer
Would you back trends that still have support, but stand aside when the support is waning?Euler wrote:If you are active and in the market long enough it's really easy to support something that is trending and is continuing to get support and something that is trending but no longer has support.
Jeff
He is.
Any experienced trader who tells you otherwise is either lying to you or to themselves, as everyone who's been around the block a few times has lost money due to emotions like fear and greed.
Jeff
Any experienced trader who tells you otherwise is either lying to you or to themselves, as everyone who's been around the block a few times has lost money due to emotions like fear and greed.
Jeff
Tonto wrote: Thanks JollyG. What you are saying is that some people's losses are caused by their psyche. I'm sure that you are right.
YesFerru123 wrote:Would you back trends that still have support, but stand aside when the support is waning?Euler wrote:If you are active and in the market long enough it's really easy to support something that is trending and is continuing to get support and something that is trending but no longer has support.
Jeff